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The headline Final Demand Producer Price Index using new methodology increased 0.4% in January following an unchanged reading in December. The year-on-year (y/y) gain edged up to 2.7%. A 0.3% January rise had been expected in the Action Economics Forecast Survey. The PPI excluding food & energy also increased 0.4% in January, well above the 0.2% expectation. Year-on-year growth decelerated slightly to 2.2% from 2.3% in December. An updated measure of core producer price inflation -- the overall index excluding food, energy and trade services -- showed the same 0.4% gain last month. This took the y/y growth to 2.5%, the strongest reading since the series began in August 2013.

Using the old methodology for the Producer Price Index, prices surged 0.7% (+3.0% y/y) in January following an unchanged reading. Excluding food & energy, the index edged up 0.1% (1.9% y/y).